By Matt Hussey
4 min read
Ripple is the project behind the cryptocurrency called XRP, but the way it works and runs is very different from other currencies like Bitcoin and Litecoin.
It doesn’t rely on energy-intensive mining in order to work or create new currency.
Instead, the company it created its currency, called XRP all at once, and the people behind Ripple gradually sell it as and when they need to.
It's also more focused on developing a method to help banks and other financial institutions move money faster and without fees rather than a way for people to buy goods and services.
Some people in the Ripple community call the smallest unit of Ripple a ‘Jed’ after Jed Calab, one of the company’s founders.
The pre-cursor to the Ripple and its XRP currency as we know today was first developed by Ryan Fugger, a web developer in 2004.
But it wasn’t until 2012 - and the work of Jed Caleb and Chris Larsen - that lead to what we now know to be XRP.
There are two parts to Ripple: Ripple as a cryptocurrency (XRP), and Ripple as a company designed to help banks move money quickly and cheaply.
Ripple doesn’t involve miners and nodes in the same way as other currencies. Instead, it created 100 billion Ripples at the point of inception and has been steadily selling them every month to help raise money.
Ripple currently owns more than 60% of all XRP in existence, and releases around 300 million every month.
You can head over to an exchange and buy XRP with dollars, pounds or euros.
It’s not seen as a tool to buy goods and services like Bitcoin or Litecoin. However, there are a few places that let you buy goods using Ripple’s XRP currency.
15 of the 50 biggest banks use Ripple to move money around the world.
Ripple wants to help the banking industry move money as quickly and simply as sending someone an email.
The company’s focus is to bring all the world’s big banks on to the platform.
The future of XRP meanwhile is less certain, but if Ripple does become the platform banks do business online it’s currency will be tied to that success.
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